Insurer wants to consolidate after two major deals before expanding further AXA China Region plans to consolidate the two acquisitions it made in the local insurance market last year before expanding further, according to its new Hong Kong head. John Cai, the chief executive of AXA's Hong Kong division, said he expected to complete the merger of AXA and Winterthur Hong Kong in the first quarter of next year. 'We have done two acquisitions and there is a lot to do to consolidate the businesses. Let's take a break to consolidate what we have. I do not think we have time for more acquisitions in the near future,' he said. AXA China Region is part of AXA Asia Pacific Holdings which is a member of French based AXA Group, one of the world's largest insurance and wealth management companies with 50 million customers worldwide, including one million in Hong Kong. AXA agreed to buy Winterthur Life (Hong Kong) for up to HK$2.4 billion just after Christmas. Last June it completed the HK$3.3 billion buyout of MLC's Hong Kong and Indonesian units from National Australia Bank. The two deals raised AXA's ranking to No3 in the city in terms of new life insurance premium income last year, overtaking Manulife. It now trails only HSBC and American International Assurance. Mr Cai said the impact of the two purchases would be different. The niche that MLC occupies is similar to the one that AXA occupies - selling life insurance products to the mass market. The acquisition of MLC added 15 per cent to AXA's business volume last year. The Winterthur deal, on the other hand, will introduce AXA to a new market segment. 'While AXA is strong in life insurance and unit-linked products for clients, Winterthur is strong in wealth management and investment products for high net-worth clients. The mergers will achieve our goal of being able to offer comprehensive protection and wealth management services for a wider range of clients,' Mr Cai said. The Winterthur deal will add HK$2.7 billion in gross premiums to AXA's Hong Kong unit. It will also increase AXA's Hong Kong sales force by 540 to 3,100 agents and 600 salary-based associates - the second-largest sales team in the city after American International Assurance, whose team numbers 8,500 agents. Mr Cai said both acquisitions were part of AXA's strategic growth plan adopted in 2004. 'We can grow organically but we also want to expand by acquisitions. We have set the strategy to look for good buying opportunities in Hong Kong,' Mr Cai said. 'The MLC merger is complete. Now we have to integrate the one million customers and 3,000 agents with the Winterthur business to maximise the value of our purchase,' he said. While the MLC brand has been phased out, the company has not yet decided whether to preserve the Winterthur brand name. 'Winterthur is a good brand in wealth management for high net-worth clients. We will decide whether to keep it as an independent brand in the near future,' Mr Cai said. He said mergers were difficult but AXA was up to the challenge. 'AXA is famous for buying its competitors at the right price and has a lot of experience in mergers and acquisitions. We'll make sure the clients and sales forces of the two companies will enjoy the benefit of the mergers.'